Question

Find the value of $15,000 at the end of one year if it is invested in an account that has an interest rate of 4.95% and is compounded in accordance with the rules below. a. compounded monthly b. compounded daily​ (assuming a​ 365-d

Answer 1

Answer:

Results are below.

Explanation:

Giving the following information:

Initial investment= $15,000

To calculate the future value, we need to use the following formula:

FV= PV*(1+i)^n

a) i= 0.0495/12= 0.004125

FV= 15,000*(1.004125^12)= $15,759.58

b) i= 0.0495/365= 0.0001356

FV= 15,000*(1.0001356^365)= $15,761.04